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Survey shows how a West Coast port strike will Impact US Logistics.

Thanks to all those logistics professionals that completed our survey on the impact of a potential West Coast port strike.

With a strike looming as the holiday season gets nearer, NRS’ survey found that only 52% of the companies who responded are prepared.

The logistics professionals surveyed came from various backgrounds including: 36% in manufacturing, 18% in retail, and 23% from other 3PL logistics providers across the USA.

What contingency plans do you have in place? *

The anticipated strike has lead to a variety of supply chain contingency plans to help avoid shipping delays and keep store shelves stocked in time for the holiday season. The most popular of those is to route freight through alternative ports in the event of a strike.

What alternative port will you primarily use? *

New York / New Jersey is the most popular alternate port choice with 39%. The up and coming port of Savannah, Georgia is the next most popular option with 26%, and the Canadian Port of Vancouver is seen as the third best option for a further 23% of companies. These ports are likely to see a commerce boom if the strikes take place, but how much trade will return after a strike ends? Will businesses want to mitigate future risk and leave a proportion of their imports coming through alternative ports?

What percentage of your products are imported into the USA? *

The companies surveyed are big importers of goods into the USA. 59% of the respondents said that their companies imported more than 90% of their total inventory and 65% had at least 75% of their total imports currently routed through the West Coast ports. With this heavy reliance on imported goods, the importance of both a low risk and flexible logistics set up is vital and these businesses cannot simply look at headline shipping costs. Should the strike go ahead it will, without doubt, be costly for US businesses and their 3PL partners.

How much money would a week long West Coast port strike cost your company? *

Although about 20% of those surveyed didn’t know, or didn’t want to disclose their potential losses in the case of a strike, the information from the remainder was notable. A week-long strike will be bearable for most with 70% (of those that expressed a value) having losses of less than $250k, although 5% of the businesses will lose over $1 million with only a week long strike. The picture if the strike extends for a month is much more serious with losses over $500k and above being suffered by 50% of those who provided an estimated figure.

How much money would a month long West Coast port strike cost your company? *

Therefore the seriousness of the potential West Coast port strike should not be underestimated, especially if it extends for any significant period of time with companies suffering large losses. The logistics industry will face capacity issues with the re-routing of vast amounts of freight to alternative ports: New York / New Jersey; Savannah, Georgia; and Vancouver, Canada. Container drayage will be put under strain as normal logistics patterns will be changed enormously to cope with the increase in demand. If the strike goes ahead and businesses suffer the scale of losses that are possible, will the West Coast ports ultimately then lose out in the long-run as companies choose to mitigate risk by shipping more freight via alternative ports in the future?

National Retail Systems, Inc. (NRS) includes Keystone Freight Corp. & National Retail Transportation, Inc. (NRT). NRS is a family-owned and operated company that has been providing smart logistics solutions for the world’s leading retailers and manufacturers for 60+ years. We are the ultimate 3PL.